Gold Rebounds on Rate Cut Expectations and Middle East Tensions

On Thursday, we believed that the market's expectations for a significant rate cut by the Federal Reserve in November cooled down, and concerns about the escalation of tensions in the Middle East eased, which suppressed gold prices. In terms of operations, we suggested treating the market with a fluctuating mindset, focusing on support at $2604 and $2600, and resistance at $2617 and $2624. Additionally, we advised paying attention to the impact of the evening's US CPI data. If gold fluctuated sharply and broke through the fluctuation range, it might run in one direction.

Looking at the subsequent trend, gold fell to $2605 in the Asian and European sessions and stabilized, rebounded to $2618 and encountered resistance, opened in the US session, and gold plummeted to $2605 in an instant, then quickly rebounded to $2020, and continued to fluctuate upwards. During this period, it回踩ed $2616 twice and stabilized, reaching a high of $2630 and encountering resistance; on Friday, gold continued to rise to $2635, and is currently trading at $2633. Overall, gold stabilized and rebounded near the support we provided at $2604, broke through the fluctuation range, and gold prices continued to rise in the same direction. The pressure near $2617 turned into short-term support, and the trend basically met expectations.

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Wolfinance star analyst Huang Lichen believes that since the Federal Reserve chairman indicated that he might cut interest rates by 25 basis points at a slower pace, and the strong performance of the September non-farm data, the market has basically ruled out the possibility of a significant rate cut in November. At the same time, Israel did not take retaliatory measures after Iran fired missiles at it, alleviating market concerns about the situation in the Middle East. The two major bearish factors overlapped, suppressing gold prices and approaching the $2600 integer position. However, on Thursday, expectations for a rate cut by the Federal Reserve were boosted, and geopolitical concerns heated up again, driving a rebound in gold.

In terms of news, the US September CPI data released on Thursday performed slightly higher than market expectations, but there were no big surprises. Its year-on-year increase was the lowest in three and a half years. In addition, the number of initial jobless claims was higher than expected, rising to the highest since August last year. The market expected the probability of the Federal Reserve cutting interest rates by 25 basis points in November to rise to 89%, and the probability of maintaining it unchanged was 11%. In addition, on Thursday, the Israeli Security Cabinet held a meeting to discuss subsequent actions against Iran and Lebanon, and market concerns about geopolitical situations heated up again. On the daily chart, gold stopped falling and stabilized above the $2600 integer position, alleviating short-term correction pressure. For gold support, focus on the daily Bollinger band middle track at $2629, which is also the weekly MA5 moving average position, close to the current daily low. If it fails to hold here, it may fall short-term and continue to focus on the position where gold prices rebounded twice after rising on Thursday at $2616, and the lowest point试探ed in the last three trading days at $2604; for gold resistance, focus on the daily 10-day moving average at $2640, and the second is the 4-hour Bollinger band upper track at $2650. The 5-day moving average and MACD indicator death cross slows down, and the KDJ and RSI indicators death cross upturn, showing that gold has a rebound demand after a short-term adjustment.

Gold intraday reference: The expectation for a rate cut by the Federal Reserve was boosted, and concerns about the situation in the Middle East heated up again, supporting gold to stop falling and rebound. In terms of operations, it is suggested to focus on the daily Bollinger band middle track and the weekly MA5 moving average position at $2629. If gold holds steady here, there is an opportunity to continue rebounding, and resistance above focuses on $2640 and $2650; if gold fails to hold here, it may fall short-term and focus on $2616 and $2604. At this time, gold prices may fluctuate and consolidate above $2600.